New Year’s Resolutions Aplenty for Illinois Employers

By Aaron R. Gelb

shutterstock_checklistWhile many employers view California as a particularly challenging state in which to do business due to the variety of “unique” workplace laws and regulations, Illinois is not very far behind after a rather busy legislative session during the first year of Governor JB Pritzker’s term.  Whether or not you plan to hit the gym in 2020 or eat more vegetables next year, here is a list of New Year’s resolutions every organization should adopt if it has employees in Illinois:

□          Make sure you are not asking applicants about their salary history.

Hopefully, this is not on your list of New Year’s resolutions because the bill went into effect on September 29, 2019 after being signed into law by Governor Pritzker over the summer.  Under this new law, the Illinois Equal Pay Act has been amended to bar employers from asking a job applicant about their salary history.  Illinois employers may no longer screen or disqualify applicants because of their current or prior salary, nor can they insist that an applicant disclose his or her salary history in order to be interviewed, considered for or offered employment.  Forget about going straight to the source as the law also prohibits seeking such information from the applicant’s former employer.  Perhaps most significantly, the amendment also prohibits employers from factoring salary history information into compensation or hiring decisions even if an applicant provides the information voluntarily without prompting

□          Allow your employees to discuss their wages or other compensation issues with each other.

While Illinois employers can still prohibit select employees—human resources, for example—from disclosing confidential wage and salary information, they cannot otherwise place such restrictions on other employees.  The ability to discuss compensation has long been protected by federal law, so this new Illinois law should not pose any particularly unique challenges for Illinois employers.  That said, employers should take steps to ensure their managers understand the extent of the rights afforded their employees to openly discuss such issues, even if it has the potential to cause waves with their coworkers.

□          Schedule sexual harassment training in the latter part of the year.

Beginning July 1, 2020, Illinois employers will be expected to provide annual workplace sexual harassment training to employees and managers.  While the IDHR will be required to develop and make available a model sexual harassment prevention training to the public at no charge, it is not clear at this time when that will take place.  In the meantime, employers may develop their own program or wait for the free model program to be released.  Those employers that opt to create their own program must ensure that it includes an explanation of sexual harassment, examples of unlawful sexual harassment, a summary of relevant federal and state statutory provisions, and a summary of the employer’s responsibilities under the law.

□          Update your EEO policies.

There have been several amendments to the Human Rights Act, which will become effective July 1, 2020. Importantly, with a few limited exceptions, the amendments make the Illinois Human Rights Act (“HRA”) applicable to all Illinois employers, not just employers with 15 or more employees.  The HRA will now also apply to working environments beyond the physical location at which employees perform their assigned duties, which means that remote workers who claim to have been harassed online may presumably bring a claim against their employer; whether that will apply to individuals employed outside of Illinois but work for an Illinois company or report to an office in Illinois, remains to be seen.  This also means that employers would be well-advised to pay closer attention to off-site events such as holiday parties and ensure that any off-site incidents that are brought to the company’s attention are addressed as if they had occurred in the workplace.  EEO policies should also be revised to reflect the fact that the HRA now protects against discrimination or harassment on the basis of an individual’s “perceived” status; meaning that an employee may now bring a claim that they were discriminated against or harassed because they were perceived to be from a certain country or of a certain sexual orientation, for example, even if that is not the case.

Employers that operate a restaurant, bar or casino will face additional requirements intended to protect their employees from sexual harassment, including the need to (1) provide certain employees with personal safety and notification devices that may be used to summon help if they are the victim of or are witnessing sexual harassment or a crime; (2) expressly inform each of their employees about the protections against sexual harassment and discrimination as provided by state and federal law (by giving them a copy of a harassment-free workplace policy); and (3) to take measures to separate employees from offending guests and accommodate employees who seek legal protection against offending guests.

□          Reevaluate your drug testing policy and procedures.

The Cannabis Regulation and Tax Act (“CRTA”), which goes into effect January 1, 2020, allows individuals 21 years of age and over to consume, possess and purchase cannabis. Unlike most of the other states that now allow recreational cannabis use, Illinois took the additional step of amending the Illinois Right to Privacy Act to include cannabis within the definition of lawful products.  The Right to Privacy Act, often referred to as a smokers’ rights law, prohibits employers from taking adverse actions (refusing to hire, terminating, demoting) against employees because they use a lawful product while not at work.  While the CRTA does not prohibit employers from adopting policies concerning drug testing, use, or storage while at work or on call, an employer must—in order to discipline or discharge an employee—have a good faith belief that the employee manifests specific, articulable symptoms while working that decrease or lessen the employee’s performance of the duties or tasks of employee’s job.  The statute sets forth a number of factors that may be considered, such as disregard for the safety of the employee or others, carelessness, physical dexterity, agility, speech and irrational or unusual behavior, among others.  If an employer elects to discipline any employee on the basis that the employee was under the influence or impaired by cannabis, the employer must afford the employee a reasonable opportunity to contest the basis of the determination.  The State has yet to issue regulations that provide guidance regarding what constitutes a “reasonable opportunity” to challenge such a finding; for now, employers would be wise to adopt a specific process that can be used to document the explanation offered by the employee and the company’s ultimate conclusion.  Given these requirements, employers will likely be unable to justify taking an adverse action against an employee because of a positive random test result or against an applicant due to a pre-employment test.

□          Prepare the necessary disclosures regarding adverse judgments.

The amendments to the Human Rights Act also require employers to make certain disclosures to the Illinois Department of Human Rights.  Beginning July 1, 2020, employers must make annual disclosures to the IDHR with information about adverse judgments or administrative rulings against them in the prior year.  The required disclosures cover the number of adverse judgments or administrative rulings, whether an employee obtained equitable relief, and a breakdown of the judgments and rulings by unlawful employment practice including sexual harassment and discrimination on the basis of sex, race, color, national origin, age, religion, disability, military status or unfavorable discharge from military status; sexual orientation or gender identity; and any other characteristic protected under the Human Rights Act. It is not yet clear—as no regulations have issued to date—the means by which these disclosures must be made.  The IDHR will compile the reported information about adverse judgments and administrative rulings for publication in an annual report, but it will aggregate individual data to avoid exposing personal information.  Note, also, that the IDHR while investigating a charge filed under the Illinois Human Rights Act, may request similar information about an employer’s settlements in the preceding five years that involved allegations of sexual harassment or unlawful discrimination occurring in the workplace or involving an employee or corporate executive.

□          Reassess your arbitration agreements.

Beginning in January 2020, the Workplace Transparency Act (“WTA”) bars employers from unilaterally requiring that a current or prospective employee waive, arbitrate, “or otherwise diminish” existing or future claims, rights, or benefits related to unlawful discrimination, harassment, or retaliation.  Unilateral arbitration provisions or “agreements” are quite common and often presented as a condition of employment, so there are many employers that will be impacted by this new law.  However, provisions that would be void in a unilateral agreement under the WTA may be allowed if an employer and the current or prospective employee mutually agree to it in writing, and the agreement reflects “actual, knowing, and bargained-for consideration” from both parties. To comply with the WTA, the agreement must acknowledge the employee’s right to: (1) report a good-faith belief of an unlawful employment practice or criminal conduct to the appropriate governmental authorities; (2) participate in governmental proceedings; (3) make truthful statements or disclosures as required by law, regulation, or legal process; and (4) seek or receive legal advice.  If an employer does not comply with these requirements, the WTA establishes a rebuttable presumption that the condition is unilateral and void as against public policy.

Potential and Pending Requirements for D.C. Employers of Tipped Employees

shutterstock_waiterIn October 2018, the District of Columbia (“D.C.”) Council passed a law called the “Tipped Wage Workers Fairness Amendment Act of 2018” (the “Act”), which had the immediate impact of repealing legislation (“Ballot Initiative 77”) that eliminated the use of a tip credit in D.C.  Because the D.C. Council repealed Ballot Initiative 77 through passage of the Act, employers with tipped employees are still permitted to take a tip credit toward meeting minimum hourly wage requirements.  However, the Act also imposes certain training, reporting, and notice requirements for all employers of tipped employees.  Some of these requirements have already gone into effect, while others require budgetary approval before they will kick in. We review some of the more significant requirements below.

Under the Act, all employers of tipped employees will have to provide sexual harassment prevention training to employees, as well as managers, owners, and operators of the business.  Specifically, the D.C. Office of Human Rights (“OHR”) will make available a sexual harassment training course, or will certify a list of providers to give the training, that covers how to respond to and prevent sexual harassment by co-workers, management, or patrons/guests.  The Act mandates that employers provide the training to new hires within 90 days of hire unless they received the training within the last two years.  All other workers already employed must receive training within two years.  Managers, owners, and operators must then receive training every 2 years and all training should be given in-person or online.  If the training is given by a certified provider, the employer must submit a certification to the OHR that the training has been completed.  Certification is required within 30 business days after completion. Continue reading

California Employers Are Not Required To Reimburse Restaurant Workers For The Cost Of Slip-Resistant Shoes Under Labor Code Section 2802

shutterstock_34577875A recent California Court of Appeal decision, Townley v. BJ’s Restaurants, Inc., has further defined the scope of reimbursable business expenses under California Labor Code section 2802, this time in the context of slip-resistant shoes for restaurant workers.

A former server filed an action under the California Labor Code Private Attorneys General Act of 2004 (PAGA), seeking civil penalties on behalf of herself and other “aggrieved employees” for California Labor Code violations, including the failure to reimburse the cost of slip-resistant shoes.  Plaintiff alleged a violation of Labor Code section 2802, which requires an employer to reimburse employees for all necessary expenditures incurred by the employee in direct consequence of the discharge of their duties.

Plaintiff argued that, because the restaurant required employees to wear slip-resistant, black, closed-toes shoes for safety reasons, such shoes should be provided free of cost or employees should be reimbursed for their cost.

The Court of Appeal, persuaded by the reasoning in an unpublished Ninth Circuit Court of Appeals decision, Lemus v. Denny’s, Inc., and guidance from the California’s Division of Labor Standards Enforcement (DLSE), held that section 2802 did not require the restaurant employer to reimburse its employees for the cost of slip-resistant shoes.  Specifically, the Court held that the cost of shoes does not qualify as a “necessary expenditure” under section 2802.

Continue reading

Good Faith Goes a Long Way: The Benefits of Fully Engaging in the Interactive Process Mandated by the Americans with Disabilities Act

On Monday, March 25, 2019, I had the privilege to co-present on reasonable accommodations and the interactive process under the Americans with Disabilities Act (the “ADA”) at the HR in Hospitality Conference in Las Vegas, Nevada. One of the issues Picture1covered during our presentation involved the fact that the ADA does not require that employers provide the specific accommodation requested by an employee as long as the employer offers a reasonable accommodation to the employee who made the request.  While employers can use their business judgment when deciding how best to reasonably accommodate an employee, a settlement recently announced by the EEOC underscores that many employers would be well-advised to develop internal procedures or guidelines to help ensure that those involved in the accommodation process understand what is expected of them and the company when responding to accommodation requests.   According to a lawsuit filed by EEOC in Minnesota, a Bath and Body Works store failed to reasonably accommodation a sales associate with type-1 diabetes suffering retinopathy who asked that a larger monitor screen be placed at the cash register.  Instead, a store manager purchased what the EEOC described as “a cheap, hand-held magnifying glass” to be used by the sales associate when working the register.

Under a consent decree settling the suit (EEOC v. Bath and Body Works), Bath and Body Works agreed to pay Continue reading

Pay Equity and EEO-1 Reporting Remain a Priority of Federal Regulators

Pay inequity, particularly compensation disparity based on sex, has become a very prominent political issue in the last decade and it looks like some additional changes could be on the horizon at the federal level.  Demshutterstock_532208329ocrats expressed that pay equity would be a priority in their labor agenda during the 2018 Congressional election cycle and, in February 2019, a proposal intended to further promote fair pay practices was reintroduced in Congress.   In addition, just last week, a federal judge lifted the stay on the changes to the Equal Employment Opportunity Commission’s (“EEOC”) EEO-1 Report.  The revised EEO-1 report would require certain employers to provide pay data by sex, race, and ethnicity to the EEOC, allowing it to more easily detect and track impermissible pay differentials.  Though at very different stages in their respective lawmaking processes, the proposed law and final regulation are very clearly intended to address pay inequality and provide additional enforcement tools.

Stay Lifted on EEO-1 Report

In August 2017, ahead of the 2018 submission deadline, the Office of Management and Budget (“OMB”) stayed collection of pay data based on race, ethnicity, and sex to allow it to review the regulation related to the lack of public opportunity to comment on the format of submission of the additional data and burden estimates related to the specific data file format provided.  However, on March 4, 2019, a Washington, D.C. federal judge ordered the stay be lifted because she determined that OMB’s decision was arbitrary and capricious – citing unexplained inconsistencies based on its prior approval of the rule and failure to adequately support its decision.  Continue reading

DOL Revises Field Operations Handbook to Clarify Interpretation of FLSA’s Dual Jobs Regulation

Department of LaborThe U.S. Department of Labor (“DOL”) has officially curtailed another controversial interpretation of its dual jobs regulation that has plagued employers for more than decade – i.e. the 20% rule.  This is welcome news for the hospitality industry and other employers who employ tipped employees, as the previous rule effectively forced employers to track and monitor the time that tipped employees spent on non-tipped tasks and “related duties.”  Although the DOL issued an opinion letter rescinding its interpretation of the 20% rule in November 2018, the DOL’s recent revisions to its Field Operations Handbook has official dispelled lingering concerns about the DOL’s interpretation of the Fair Labor Standards Act’s dual jobs regulation and potential enforcement of the 20% rule.

The Tip Credit

Under the federal Fair Labor Standards Act (“FLSA”), employers must pay employees a minimum wage of $7.25 per hour. Various state wage and hour laws impose higher minimum wage requirements, but employers covered Continue reading

Court Ruling Further Clarifies ADA Website Accessibility Obligations

Over the past several years, we have written extensively about employers’ obligations to make their websites accessible for individuals with visual, hearing and physical impairments.  In the past, we have counseled employers who are considered a “place of public accommodation” (such as a hotel, restaurant, place of recreation, doctor’s office, etc.) to at the very least do some due diligence to determine whether their websites are accessible for disabled users, so that those individuals can use and navigate those websites and/or purchase goods sold onWebsite Accessibility Picture the websites.  (For more information about the developing law on this issue, check out our prior posts here and here.)  Now, for the first time, a U.S. Court of Appeals has ruled on this issue and has confirmed that so long as there is a “nexus” between a company’s website and a physical location (which is typically the case), a company must make its website accessible or risk significant legal exposure for violating the Americans with Disabilities Act (“ADA”).

(As a reminder, although not the subject of this blog post, we have also written about a second consideration here regarding website accessibility that applies only to hotels and other places of lodging and currently is the subject of a tremendous amount of litigation.  Specifically, the implementing regulations of Title III of the ADA require a hotel’s website to provide information regarding various accessibility features at its property, so that a mobility impaired individual can determine whether he or she can navigate the public areas and guestrooms at the property.).

Continue reading